My suggestion is to purchase a device to work on as soon as you can. As Andy suggests, an older iPod touch is a great place to start. First, you need to get yourself acclimated to the platform, including how your users interact with it out in the wild. Live with the device as your primary media player for a week or two, and download other applications and see how they are laid out. Working in the Simulator is very different from actually holding the device in your hands. It's apparent which developers took the time to understand the platform and they way people use it when you look at the design of their applications.
In fact, I recommend picking up a first or second generation model, due to their slower hardware. If you are going to release an application that users will be able to run on the older CPUs and GPUs, you need to test your application against that older hardware. I've seen many developers fall into the trap of thinking that just because their application runs fine on an iPhone 3G S, it's good to ship, then they encounter crash after crash when users run it on older hardware (or it becomes too slow to use).
In the iPhone classes we teach at the Madison Area Technical College, we get our students to provision and install their first application on a device as soon as we can. It's vital to understand this process and we notice that it provides a real sense of accomplishment for the students to see their application running on actual hardware.